Comment on Can Reddit—the Internet’s Greatest Authenticity Machine—Survive Its Own IPO?
NeatNit@discuss.tchncs.de 3 months agoI don’t know the answer and I’m not taking a side, but considering how Reddit has never been profitable, I don’t understand how it even still exists. Where does the money come from to keep it running? This question applies to all non-profitable platforms. We know that the executives surely get their inflated paychecks, as do the employees, and the servers keep running (often better than sustainable alternatives), yet the company never makes a profit… How does that work?
Given that it’s obviously not sustainable, I can understand why “just be happy with that they’ve created” isn’t an option, but that’s the only thing I understand… Everything else is a complete mystery to me.
I use Discord a lot and I think about this often.
millie@beehaw.org 3 months ago
A business can be lucrative without being profitable. Profitable means the business itself is making a profit; that is, expanding its revenue. Reddit doesn’t need to do that in order to make everyone who works there money. They just need to keep the servers open and do a little maintenance. Reddit probably could be profitable as a business if it weren’t so lucrative for its CEOs, who presumably eat all the profits.
I agree, though. Profit and growth are poor measures of a business doing what it should be doing, which is providing a valuable product to consumers. Honestly, these days they’re probably a measure that a company has stopped providing value.
NeatNit@discuss.tchncs.de 3 months ago
The number one thing I don’t understand is, where does the money come from?
millie@beehaw.org 3 months ago
I’d imagine mostly advertising and premium accounts. I’d be surprised if there weren’t some shady deals going on for increased exposure too.
NeatNit@discuss.tchncs.de 3 months ago
But, correct me if I’m wrong, the whole thing is operating at a loss. It’s spending more money than it receives, including advertising and all. That doesn’t add up.